Flight Department Aviation Articles

Tips For Renting Your Aircraft

Renting your Aircraft

If you own an aircraft and are not utilizing it as much as you would like or if you would like to try and recover some of the cost of owning the aircraft, you may have thought about renting your aircraft to other pilots. As a practical matter, that makes some sense. But before you actually rent your aircraft to another pilot, here are a few things you should consider.

Aircraft Owners May Rent Their Aircraft To Third Parties

It is important to understand that the FAA does not prohibit aircraft owners from renting their aircraft. In fact, the regulations specifically contemplate rental arrangements. So, renting your aircraft is permitted, provided that you comply with applicable regulations. The FAA provides guidance on what is and isn’t a permissible rental arrangement in Advisory Circular 91-37B Truth in Leasing (although truth in leasing requirements only apply to large civil aircraft, the general lease concepts discussed in the AC apply to leasing arrangements for all aircraft).

Make Sure Your Insurance Permits Aircraft Rental

Most aircraft insurance policies will extend coverage to other pilots who fly your aircraft provided that the pilots are either expressly identified in your policy or if they have the necessary experience/qualifications to meet the “open pilot” clause of the policy. However, if you are going to charge the pilot for use of your aircraft, you need to confirm that your policy allows you to rent or lease your aircraft to a third-party. Most aircraft policies issued to owners for personal/business flying do allow aircraft leasing, but it is important to confirm this with your insurance underwriter.

Also, rather than paying to obtain their own insurance policy or renter’s insurance to cover their use of your aircraft, most renter pilots will want to be named as an additional insured under your policy as this can oftentimes be done at no cost to you or the renter pilot. In that case, renters will typically ask for a certificate of insurance that reflects not only that they are added to your policy, but that they are covered for their operation and use of their aircraft. This is important because it doesn’t do the renter pilot any good if he or she is added to the owner’s policy but only covered for the owner’s operation of the aircraft, rather than his or her own use.

Renting Your Aircraft Can Trigger Tax Consequences

In most states, when an aircraft owner rents an aircraft to a third-party the owner is required to collect and remit sales tax on the rent paid by the third-party for the aircraft. If you are in one of those states, in order to rent your aircraft you will need to obtain a sales tax number so you can collect and remit sales tax to the taxing authority. This is the aircraft owner’s obligation and the taxing authority will hold the aircraft owner responsible for any sales tax the taxing authority believes the aircraft owner should have collected and remitted, regardless of whether the renter pilot actually paid the sales tax to the aircraft owner.

Also, when you rent your aircraft many taxing authorities view that activity as commercial activity which then means your aircraft could be subject to assessment of personal property tax on the value of the aircraft, or some portion of the value based upon the pro-rata rental versus personal use of the aircraft. Although not all states assess personal property tax on aircraft, if you are in a state that does you will want to determine your potential property tax exposure before you decide to rent your aircraft.

Conclusion

Although you will also have other things to consider as you decide whether to rent your aircraft to other pilots, these three issues should be near the top of your list. And if you understand and address these issues up front that will help ensure a successful aircraft rental experience for both you, the aircraft owner, and your renter pilot.

How to Give Passengers a Proper Safety Brief

So here you are, a pilot rated to carry passengers, and it's time to start taxiing the aircraft. Your passengers are excited to go fly, maybe a little nervous-so it makes you nervous. You're ready to get off the ground and up in the air for the fun to begin. But wait, you can't go up just yet! You need to give the passengers a quick safety briefing for, of course, their safety. So here's a good method to help you develop a good flow for one:

Use the acronym SAFETY to make sure you cover each item you need to as outlined in 14 CFR 91.519

is for seatbelts (including shoulder harnesses) and smoking. Show them how to buckle and unbuckle their seatbelts, and ensure if there are shoulder harnesses that they're being worn and tightened properly.

As for smoking, discuss as to when, where, and under what conditions smoking is not allowed. 

After all, this isn't the "Golden Age of Travel" anymore so regulations are more strict!

is for air vents/oxygen. Especially if you're in something like a small Cessna 172 then you want to show where the air vents are for fresh air and how to adjust them. This is more for comfort but can also help if they feel sick or uneasy. If you're on a high altitude plane, like a citation, then show where the oxygen equipment is and how to use it in an emergency. The regulation here simply states "normal and emergency use of oxygen equipment installed on the airplane."

F is fire, where a fire extinguisher is located on board as well as other survival equipment. This includes if you're flying over water where the flotation equipment is and how to exit in an emergency, bringing you to the next item on the list. 

is exiting during emergencies. You've showed them how to fasten and unfasten seatbelts, now demonstrate how to exit the plane if you're unable to help them in an emergency (ex. you're unconscious). 

T=Traffic. This one is more commonly used in small planes, like back to the Cessna 172. Simply tell the passengers that if you see traffic (another aircraft) nearby and you don't think the pilot has eyes on it yet, to point out where it is using clock terms like 12 or 1 o'clock. 

Y is "your questions." Ask the passengers if they have any questions pertaining to the flight. Maybe they didn't fully understand how to open the door/canopy in an emergency. This is their chance to ask and will make both them and you feel more comfortable. After all, flying is supposed to be fun, but it can't be done if someone feels uneasy the entire time. 

Remember, safety is always the goal of every flight! Brief your passengers, stick to the checklists, and go have some fun in the air. For any other help in making sure your flight is safe and well-planned be sure to head over to Globalair.com and check out the airport resources & aviation directory. 

Have any tips to add for a proper safety briefing? Be sure to comment below and stay tuned for more blog posts!

10+ Gift Ideas for Pilots and Aviation Enthusiasts

Pilots and aviators get to do what many of us can only dream of; fly. So what do you get the people who have the ability to soar above the clouds on a weekly basis? A gift for a pilot should be practical... but it must also maintain a level of sentimentality. 

Lucky for you, we have compiled a list of gift ideas that are aviator approved! 

 

Pilot Wings Hat - $15.95

If you've ever worn a baseball cap while flying, you'll immediately understand how much of a pain (literally) it can be to wear a headset and fight with the little button on top.  Not with this stylish hat! This company had the factory leave off the button that is traditionally found on the top of a baseball cap! Perfect for a sunny afternoon flying or spending the day with friends in the hangar.

 

Leather Pilot Log - $62

You've got to make every trip count. Track each flight with our pilot log, handmade from top-grain leather. This product includes either a standard (ASA-SP-30) or master (ASA-SP-6) pilot log. 

If the special pilot in your life prefers maintaining a digital logbook, send them to Globalair.com! Ours is free, easy to use, and is fully downloadable as a text file or CSV file. And the best part is the ability to add as many aircraft profiles as you need!

 

Flight Gear HP iPad Kneeboard - $34.95

The Flight Gear HP iPad Kneeboard holds the iPad right where you need it - secure on your leg but easily within reach. An integrated kickstand means you can tilt the iPad towards you, which helps to reduce glare. A simple hook-and-loop rotation mechanism allows for portrait or landscape viewing. 

 

Personalized Bobblehead in Flight Suit - $65

Personalize a bobblehead to look just like your favorite aviator. Simply send in images of the person you want the bobblehead to be crafted after and you will receive a custom look-alike. This bobblehead will come in an Air Force uniform. 

 

Set of 5 Aircraft Posters - $21.99

These patent art prints are printed on acid-free matte paper with high-quality archival inks. The prints are shipped in a durable shipping tube and rolled to ensure they don't crease. Perfect for wall decor in a home, bedroom, or college dorm. 

 

Aviator Engraved Whiskey Set - $69.95

This personalized gift for pilots is a unique way to thank the favorite aviator in your life. Each box is made from American Maplewood with sturdy metal hinges. Inside are two custom whiskey glasses and 9 whiskey stones. Includes personalization of the engraved box and glasses with the name and year for an unforgettable gift. The Maplewood box measures 11.25” x 5.5” x 4”. Each whiskey glass is 4” tall and can hold up to 10 ounces. (Liquor not included).

 

Airplane Propeller Replica 47" - $170+

This personalized wood airplane propeller wall hanging is custom designed with hand-engraved personalization and custom colors.  Wooden airplane propellers are the perfect gift for a retiring pilot, new pilot, or for travel themed weddings.

 

Airplane Keychain - $16.99

This key chain is an awesome gift for a pilot, airman, flight attendant, anyone in the air force or for anyone who loves to travel. It features a 1-inch 20 gauge stainless steel round disc stamped with "Have a safe flight I love you Love, (Name of your choice)” and a 1 3/4 inch x 2-inch antique silver-plated metal airplane charm on a 1-inch key ring. 

 

Red Canoe Cessna Stow Bag - $79.99

The Cessna Stow fits a headset, navigational tools and your pilot operating handbook as easily as your gym gear. It is the perfect gift for the pilot who spends more time on his plane than he does at home.

 

Vintage Instrument Coasters - $21.95

These vintage instrument coasters would look great on any pilot's coffee table. They are made with scratch resistant acrylic and have non-skid rubber feet. Designed to look like vintage aviation instruments and comes in a set of 6.

 

Pilot Humor Mug - $16.85

This is the perfect gift for your aviater pilot to use for pre-flight coffee. It will surely put a smile on their face as they try to remember the correct way to spell 'aviator'. 

 

Principles of Flight Tie - $28

Fly into your next business meeting or night on the town with this silk tie that sports the graphic principles of flight. This tie is the perfect accessory for an aviator, science teacher, or anyone with his head in the clouds. 100% silk; fully lined.

 

Spark Plug Plane Paperweight - $35

Recycled spark plugs, butter knives, and nuts and bolts are welded together into the shape of an airplane, giving this mini-sculpture the power to take off with the conversation as it taxis around your desk, workshop or tool shed. It can be used as a paperweight or a simple desk ornament.

 

Pilot Humor T-Shirt - $20

Show the world how much you love aircraft with this funny t-shirt. Available in multiple sizes and colors.

 

At the end of the day, it doesn't matter how much you spend on the gift. All that matters is celebrating the love you have for that person... and for aviation. Don't stress wondering if the gift is perfect. If it is coming from you, it surely will be!

Do you have a favorite aviation-themed gift that you’ve received or a gift that you were proud to have found for someone else? Let us know in the comments below!

All prices are current at the time of posting. 
 

Aircraft Data-Driven Management

That which is measured improves…

For professionals who fly with precision and leave nothing to chance, Business Aviation leaders need to apply metrics in their managerial duties.

Conventional Wisdom has a quaint, comforting sound to it. Unfortunately, when challenged or tested, much of it can be found to be based on half-truths. Aviation is a science. Professional pilots pride themselves on the precision of their flying. The management of the flight departmental also requires precision. Thus, as an aviation manager, you should be looking for useful ways to measure your Flight Department’s performance and the value of the company aircraft as a business tool.

One area that is ideally suited for measurements is the maintenance condition of the aircraft. Today, Business Aviation recognizes the use of data tracking for maintenance. In fact, it is difficult to sell a turbine airplane that does not have some sort of electronic record keeping and maintenance reporting. For the aircraft and engines, we are moving toward measurements and data reporting in real-time.Aircraft Data-Driven Management

The civil helicopter community has taken a leadership role in maintenance monitoring with Health and Usage Monitoring Systems, typically known as HUMS. With over a decade of experience, the civil helicopter industry has discovered that not only does aircraft reliability increase when aircraft condition is monitored, there also are benefits to safety and operational control too.

For example, Gulfstream’s PlaneConnect is an aircraft health, trend and monitoring system that collects reams of data on the aircraft’s status and datalinks that information to the maintenance team on the ground for analysis as the aircraft begins its descent for landing. Ground crews are aware of any issue that must be addressed prior to the aircraft’s next departure. Their latest version, introduced on the G650 series, the Health and Trend Monitoring (HTM) system anticipates when a part or component is nearing a maintenance review and sends the alerts its land-based technician.

Dassault Falcon is implementing a similar system with its newest models. The Falcon 6X will be equipped with an on-board self-diagnosis system called FalconScan, which will monitor the aircraft systems and collect about 10,000 parameters in real time. The technological advancement that has enabled monitoring of aircraft condition is the ability for near instant communication.Aircraft Data-Driven Management

With the advancements in airborne connectivity, most turbine aircraft can have real-time data collection and reporting to the flight department.

But there are many more opportunities to make use of data in the management of the aviation operation.  While quality control engineer and statistician W. Edward Deming is often credited with saying “What you don’t measure can’t be managed” (he didn’t), measurements for measurement’s sake leads to data overload and an inability to see the trends that matter. With regards to measurements, the corollary statement is, “If you step on the scale, you’d better do something about it.” Raw data without a system for analysis and a mindset to use the information data provide, are of little value.

Aviation Management’s Role

Data-based management starts at the top. A corporation thrives on profit and loss. Management has a number of metrics that indicate not only the current profitability of the company, but trends that will affect long-term profitability. To be useful, a metric needs to be tailored to the business function, or in our case, the aviation business function.

Business Aviation is a means of transportation for the firm’s personnel and clients. As such, immediately after safety, service should be your Flight Department’s top priority. With safety, accidents are a terrible measure, but they are indeed a metric. Organizations that value safety seek smaller measures like incidents as well as counting or measuring processes and procedures that are not followed properly, to track their quest for safe operations. Using such measures, intervention can be instituted before tragedy happens.

The level of service provided extends beyond hours flown and passengers carried. Things like denied trip requests and days the aircraft is unavailable due to maintenance can lead to a discussion of whether the current aircraft is adequate or whether it is time for another aircraft. Tracking sales made by passengers flown on the business aircraft as well as new contracts signed as a result of meeting with clients also are very important metrics of a business aircraft’s usefulness.

There are other ways to develop and maintain various metrics to improve the levels of service as well as better manage costs.  Measuring things such as staffing, additional duties, and days away from home can provide both efficiency metrics and be an leading indicator for turnover.

Organizations like the National Business Aviation Association and Helicopter Association International are supporting these measurements though education and industry cooperatives. The leadership of this effort comes from forward-looking aviation managers who understand and support the needs of the corporation.

There are many different measure of success.  Choose ones that fir both your operation and what it is that you want to measure. More on that later...

 

David Wyndham - David joined Conklin & de Decker in 1993. His primary responsibilities include developing and managing new programs for the company, conducting consulting studies, managing aircraft cost and performance databases, and providing customer computer support.

 

Misconceptions about Aircraft Costing

Over the years I have written a number of articles discussing aircraft operating costs and methodologies for analyzing them. This month, I’d like to review some common misconceptions about costs that I run into on a regular basis. Most of these result from connecting something that we are familiar with, like the cost of running an automobile or building a house, and using those as an analogy for the unfamiliar cost of owning and operating an aircraft. 

Misconceptions about Aircraft Costing

The biggest misconception is focusing on the acquisition cost to the detriment of operating costs and asset value over time. I have a client whose maximum acquisition budget is $20 million. This is a real limit and not one to exceed. Where the misconception arises is that if we are looking at Aircraft A with a selling price of $20 million and Aircraft B which sells for $17 million, the former aircraft is the less costly option. But is it?

Assume that both aircraft have similar capabilities in terms of range and cabin.

 

The only way to know which one costs “less” is to evaluate the total costs to acquire, operate and dispose of the aircraft. Two major costs are the operating costs, to include maintenance, and the estimated residual value after a set length of time. Looking at our current scenario, Aircraft A has a lower fuel consumption than Aircraft B. Aircraft A also has engine and airframe maintenance costs similar to Aircraft B. Looking at the costs per hour:

Variable cost.                        Aircraft A.                  Aircraft B. 

Fuel                                        $1,376                        $1,521

Engines                                  $ 580                          $560

Maintenance                         $ 784                          $677

Per Hour                                $2,740                        $2,758

There is more:

Aircraft A flies faster than Aircraft by 8%. Remembering the aircraft fly from origin to destination, the faster aircraft uses fewer hours to fly the same trips. If Aircraft A flies 400 annual hours, this requires Aircraft B to fly 432 hours. The annual variable cost is

Variable cost.                        Aircraft A.                  Aircraft B. 

Per Year                                $1,096,000                $1,191,456

Aircraft A costs almost 10% less in variable cost per year than Aircraft B. If both have about $650,000 per year in fixed costs, the annual operating budget favors Aircraft A slightly. While not enough to make up the $3 million price difference, it does account for about $1 million over 10 years. There is still more.

Aircraft A is a popular model and is currently selling better than Aircraft B. Current market values are being maintained better than for Aircraft B. After 10 years the estimated residual (resale)  value in dollars and percent is higher for Aircraft A. Now our 10-year life Cycle Cost is:

10 YEAR COST.                               Aircraft A                               Aircraft B

Acquisition                                        $20,000,000                         $17,000,000

Variable costs                                   $ 10,960,000                         $11,914,560

Fixed Costs                                       $ 6,500,000                           $ 6,500,000

Resale value                                     ($10,000,000)                       ($ 7,500,000)

10-Year TOTAL                                $27,460,000                          $27,914,560

Aircraft A costs about the same to own and operate as Aircraft B. Making the purchase decision just on acquisition price doesn’t tell the entire story. In the above example, we need to evaluate of parameters in addition to just costs to determine which aircraft is the best value. 

There could be other considerations like product support. Not only the perceived quality but where are the service centers located? If Aircraft A has a service center on your home field while Aircraft B’s nearest service center is 300 miles away, Aircraft A will be easier to maintain and, if AOG at home, might be repairable in less time.

Consider the equipment? What if Aircraft B has a more advanced SVS than Aircraft A? But what if you prefer the usability and displays in the avionics system on Aircraft A?

Never let a spreadsheet make a decision for you.  Never just look at a single cost item when evaluating aircraft costs. Aircraft are not commodities sharing essential the same characteristics. That is why I stress to my clients to look for a best value when making the aircraft decision. Costs are a very important part, but even the total costs do not tell the total story. 

If you are currently in the market for an aircraft please review Globalair.com and their Aircraft Exchange.

(This is a 2nd edition of this article and may be found on other websites)

 

 

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